Founder of GenPhar found guilty in all but one count

That’s how Jian-Yun “John” Dong was described this week in federal court by prosecutors and witnesses. They included his ex-wife and his former employees at GenPhar, the Mount Pleasant biotechnology company he still leads today.

Dong, 56, was found guilty of six of seven counts involving illegal campaign contributions to U.S. Sen. Lindsey Graham, lying to investigators and witness tampering.

Dong showed little emotion in the courtroom when a clerk of court read the verdicts. He was found guilty on counts involving the conspiracy and execution of illegal campaign contribution through proxies, except for one count involving a 2009 contribution.

He was found guilty of three counts of making false statements to investigators and one count of witness tampering.

Dong funneled money through his employees and others to Graham between 2006 and 2009 after he and his wife at the time, Danher Wang, had reached their contribution limit.

Graham was never accused of any wrongdoing and prosecutors said he and his staff were unaware that the contributions were tainted.

Wang, 53, testified against Dong this week after pleading guilty last week to her role in the illegal campaign contribution scheme. The pair are now divorced, according to Dong’s attorney, James Griffin. She was not in the courtroom when Dong was found guilty.

How he got here

Persecuted as an “intellectual” in communist China, Dong told the jury Thursday that he had even been arrested once by Chinese police. Dong said they kicked and beat him. Surprisingly, Dong said, he was released after six weeks.

Shortly after, Dong left the country to study in the U.S. in the 1980s. He had been married one week to Wang, whom he had met in medical school in China, before he left for the U.S.

On the stand, Dong shed tears as he spoke of the longing he felt for his wife while he was studying at the University of Alabama-Birmingham, where he was getting a degree in cellular molecular biology.

Wang later joined Dong and the pair made their way to Charleston, where he began to work at the Medical University of South Carolina. He then founded GenPhar, short for genetic pharmaceuticals.

Schemer or patriotic?

In 2003, following the 9/11 and anthrax attacks, Congress allocated money for a new project, Bioshield. It would fund special projects involving defenses against bioterrorism.

The Department of Health and Human Services called for vaccination development for the Ebola and Marburg viruses.

Around that time, Dong was the chief scientist at GenPhar, and he wanted a piece of the Bioshield pie to fund his vaccination research, according to testimony.

That’s when the contributions to Graham began.

Why Graham?

GenPhar competed for the Bioshield grant money, and lost it to a company in the Netherlands, Dong’s attorney said. Graham was outraged over the outsourcing of bio-defense, according to Griffin. That’s what made the senator so attractive to Dong, he said. Dong believed those jobs, that money, and the research all belonged in the United States, moreso in South Carolina, Dong said.

But Dong wanted that work at GenPhar, prosecutors said. That’s why he began making contributions to Graham, in hopes the S.C. senator would steer federal funds towards GenPhar through grants and earmarks.

Dong said it wasn’t about that. He believed in his leader, he said. Dong wanted to support the man who wanted to keep bio-defense work in the U.S., he said.

When Dong reached the limit in the amount he and Wang could contribute to Graham, Dong reached out to his employees at the time, he said.

He got them to make contributions to the Upstate Republican and would reimburse them. Dong, who repeatedly referred to campaign contributions as a privilege during his testimony, wanted others to share in his idealistic enthusiasm, Griffin said during his closing arguments.

Dong did not know what he was doing was illegal, he said. Dong told the jury that he never would have put his employees or his wife in that position, if he knew it was wrong.

During his testimony Thursday, Dong fought back tears as he told the jury that his “stupid mistake” cost the jobs of GenPhar employees and led to the loss of federal projects, he said. “I would never jeopardize the interest of the company,” Dong said.

But that’s exactly what prosecutors said Dong did. “This case is about what he knew and when he knew it,” said Peter Phillips, an assistant U.S. attorney.

Prosecutors told the jury that Dong relentlessly tried to get Reinhard Hubner, a foreign national and an investor in GenPhar, to donate to Graham’s campaign. Hubner and others told Dong several times that it was illegal, according to testimony.

Hubner eventually gave Dong $32,000 for Dong to do as he pleased, according to testimony. Some of that money was contributed to Graham through proxies.

Hubner was granted immunity before he testified this week, and he will not be charged in the case, according to prosecutors.

Dong was found not guilty for two contributions that were made by Wang’s sister and brother-in law. They were never reimbursed by Dong or Wang.

What’s next?

After the jury was dismissed after a week-long trial, Assistant U.S. Attorney Mark Moore asked the judge that Dong be taken into custody because of what he called previous bond violations. Moore expressed concern over Dong’s continuous ties to China, including a girlfriend who lives there, he said.

Dong won’t be sentenced for a few months, so he is supposed to remain out on bail until that time, unless the judge revokes it.

Judge C. Weston Houck denied Moore’s request. Dong’s right hand clutched his chest as Houck said those words. He’ll remain a free man until he is sentenced.

Dong has another battle ahead with the upcoming federal trial to face other allegations involving GenPhar. He is charged with using false claims and bogus paperwork to steal $3.6 million worth of federal grant money that was intended for research on the vaccines for the Ebola and Marburg viruses.

Authorities said he used the money to pay for lobbying and to entertain a mistress in China, among other things.

Company gone cold?

At one point, GenPhar had up to 20 high-level scientists working on research and development, Dong said. They had effective vaccines against the Ebola and Marburg viruses. The best ones, he claimed.

Following the allegations and investigation into Dong, the company has fallen from grace. Now, GenPhar consists of three employees — Dong, Wang and another employee baby-sitting a freezer containing their vaccines at a Mount Pleasant office building.

“If the power is turned off, they would all die,” Dong said during his testimony.

Reach Natalie Caula at 937-5594 or Twitter.com/ncaula.

Enlarge Jian-Yun “John” Dong, founder of the Mount Pleasant-based biotech company GenPhar, was found guilty of six counts in federal court on Friday.

Jian-Yun “John” Dong, founder of the Mount Pleasant-based biotech company GenPhar, was found guilty of six counts in federal court on Friday.

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